Stacks (STX), one of the top layer2 solutions on the Bitcoin ecosystem, plans to unveil its Nakamoto upgrade on Wednesday, August 28.
The upcoming update marks a crucial milestone for Stacks Network as it will revolutionize the Bitcoin DeFi market through swift transaction settlement.
The #Stacks Network’s Nakamoto Upgrade, launching on August 28, will significantly enhance #Bitcoin’s #DeFi ecosystem by improving transaction speeds to around five seconds and introducing #sBTC, a #decentralized asset backed 1:1 by Bitcoin.
This upgrade is expected to… pic.twitter.com/tPMcimbrAd
— TOBTC (@_TOBTC) August 26, 2024
Currently, Stacks Network users take approximately 10 minutes to complete a transaction, similar to Bitcoin. That could sound like years to platforms like Tron, which processes 2000 transactions per second (tps).
Meanwhile, the upcoming upgrade will see Stacks reducing its transaction speed to about five seconds – a massive improvement that will bolster the blockchain’s usability.
Developers have been reluctant to launch projects on the Stacks Network due to uninspiring speeds. That has dented user experience while restricting creators from introducing multifaceted DeFi products on the Bitcoin platform.
Thus, the Nakamoto Upgrade will unlock massive potential for the Stacks blockchain and its products (such as Velor).
Moreover, the STX platform will introduce a Bitcoin-pegged asset sBTC four weeks after launching the Nakamoto upgrade.
sBTC, tied 1:1 to Bitcoin, will enable BTC transfer between Stacks and the Bitcoin network. Also, users would utilize the new decentralized token for gas fees.
Transforming the Bitcoin blockchain
The Nakamoto activation will revolutionize the Bitcoin network in multiple ways. BTC L2s introduced decentralized finance and other applications for the largest crypto by market cap.
However, layer 2 networks face limitations as users lack a trustless way to use their BTC assets in smart contracts and applications.
Further, Stacks’ primary objective to make Bitcoin a fully programmable platform has hit a rock due to BTC’s restricted scripting language.
That makes interacting with Bitcoin or writing to BTC in a way resembling fully functioning apps or smart contracts nearly impossible. Meanwhile, sBTC will enable smooth writing to Bitcoin via a trustless 1:1 peg approach.
The sBTC peg mechanism will likely boost the functionality and security of BTC layers, propelling them to rival the likes of Optimism and Arbitrum.
The Nakamoto activation will introduce lucrative capabilities that strengthen Stacks as a BTC L2.
Besides the Bitcoin pegged sBTC and trustless, the upgrade would allow swift STX transactions within the Bitcoin ecosystem.
Meanwhile, Stacks becomes the first BTC-based layer 2 to enable trustless BTC transfers & Bitcoin writes while securing transactions using Bitcoin’s hash power.
That creates an attractive avenue for developers and entrepreneurs to introduce new services and tools using the updated technology.
STX’s current price action
Stack’s native token exhibited bearishness during this publication, down 0.45% within the past day to hover at $1.79.
Source: Coinmarketcap
STX seems ready for more dips amid deteriorated daily trading volume.
However, the upcoming Nakamoto upgrade will likely shift this trajectory to bullish, catalyzing notable price jumps for the altcoin.
STX could reclaim its monthly high of $1.96 before opening the doors for more growth.
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